Gold hits near two-week low after US, EU agree to tariff deal

Gold prices fell on Monday to their lowest in nearly two weeks, as a framework trade agreement between the United States and European Union reduced appetite for safe-haven assets.

FUNDAMENTALS

* Spot gold was down 0.1% at $3,332.39 per ounce, as of 0020 GMT, after touching its lowest level since July 17.

* U.S. gold futures edged 0.1% lower to $3,332.50.

* The U.S. struck a framework trade agreement with the European Union on Sunday, imposing a 15% import tariff on most EU goods – half the threatened rate – and averting a bigger trade war between the two allies that account for almost a third of global trade. * The agreement mirrors key parts of the framework accord reached by the U.S. with Japan, but like that deal, it leaves many questions open, including tariff rates on spirits, a highly charged topic for many on both sides of the Atlantic. * Investor sentiment improved following the deal, with European currencies and U.S. stock index futures trading higher.
* Senior U.S. and Chinese negotiators will meet in Stockholm on Monday to tackle longstanding economic disputes at the centre of a trade war between the world’s top two economies, aiming to extend a truce keeping sharply higher tariffs at bay.
* The U.S. dollar index eased 0.1%, making greenback-priced bullion less expensive for overseas buyers.
* The Federal Reserve is widely expected to leave its benchmark interest rate in the 4.25%-4.50% range at the conclusion of a two-day policy meeting on Wednesday. Fed Chair Jerome Powell has indicated the central bank should wait for further economic data before making any rate adjustments.

* U.S. President Donald Trump said on Friday he had a positive meeting with Powell, suggesting the Fed chief might be inclined to lower rates.

* Spot silver was up 0.1% at $38.17 per ounce, while platinum gained 0.9% to $1,413.50 and palladium rose 0.5% to $1,225.25.